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A New Jersey man allegedly used cars donated for the New York charity Ray of Hope to boost inventory at his North Carolina used car dealership, said the New Jersey Attorney General's office.

The state accused Steven Ashley of Essex County with breaking New Jersey's consumer and charity registration laws in a lawsuit filed by the AG's Division of Consumer Affairs. According to the complaint, investigators responded twice in 2009 to advertisements seeking car donations for Ray of Hope, whose stated purpose was "to provide medical, educational and cultural assistance and benefits to children and the disabled."

They were allegedly told they would get cash and a vacation trip as well as a tax deduction. The lawsuit also alleges that Ashley -- using an alias -- didn't disclose that the IRS requires a written appraisal of the car, and that the value of the cash and vacation would have to be reported as income, reducing the tax deduction.

Ashley, who has an unlisted number, could not be reached for comment. During a state deposition, Ashley pleaded the Fifth Amendment and declined to answer when investigators asked what happened to the cars he acquired from donors, and why he used North Carolina dealer plates, according to the lawsuit.

An official for Ray of Hope, also known as the International Foundation for Children and the Disabled, told investigators that Ashley had donated his time to the charity to assess car conditions, but was not connected to the group as of March 2008.

"In these times, consumers are regularly bombarded by mailings, ads, and billboards – all asking them to make tax-deductible donations. Unfortunately, some of those are for illegitimate charities that exist only to bilk the public," Thomas R. Calcagni, New Jersey's consumer affairs acting director, said in a statement. "We will vigorously pursue any fraud operator that deliberately misrepresents fundraising intentions or solicits charitable funds for phony causes."

New Jersey also slapped Ray of Hope for not being registered with the state between 2005 and 2009. In a recent settlement, the charity's Irina Shvartser paid $17,500 in fines and investigation costs and will be barred from seeking donations in New Jersey for the next five years.